TRW & Co · Disputes and arbitration
Arbitration Act 2025: Key Changes for London Arbitration
The Arbitration Act 2025 updates the Arbitration Act 1996 for arbitrations started on or after 1 August 2025. It makes the law of the seat the default law of the arbitration agreement, imposes a statutory duty of arbitrator disclosure, confirms summary awards, supports emergency arbitrators and narrows section 67 jurisdiction challenges.
Key pointThe reforms apply to every arbitration commenced on or after 1 August 2025, whenever the contract was signed, so legacy clauses with a foreign governing law and a London seat may now be governed by English law unless the parties chose otherwise expressly.
At a glance
In force 1 August 2025
The Act received Royal Assent on 24 February 2025; its main amendments apply to arbitral proceedings commenced on or after 1 August 2025.
Law of the seat default
Absent an express choice for the arbitration agreement itself, the law of the seat governs it; the main contract's governing law no longer counts.
Mandatory disclosure duty
Arbitrators must disclose circumstances that might reasonably give rise to justifiable doubts about impartiality, including those they ought reasonably to know.
Summary awards confirmed
Unless the parties opt out, tribunals may decide claims or issues summarily where a party has no real prospect of success.
Narrower section 67 challenges
Rules of court may stop parties who participated from raising new jurisdiction grounds or evidence, and end full rehearings, subject to the interests of justice.
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The short answer: what the Arbitration Act 2025 changed
The Arbitration Act 2025 amends, rather than replaces, the Arbitration Act 1996. It received Royal Assent on 24 February 2025 and its substantive changes came into force on 1 August 2025. The headline reforms are a new default rule on the law governing the arbitration agreement, a statutory duty of arbitrator disclosure, an express power for tribunals to make awards on a summary basis, clearer support for emergency arbitrators and a narrower procedure for jurisdiction challenges under section 67.
The reforms followed a review by the Law Commission, which concluded that the 1996 Act worked well and needed targeted updating rather than a rewrite. The result is evolution, not revolution, but several changes affect how arbitration clauses should now be drafted and how London-seated disputes are run.
What did not change
Much of the 1996 Act is untouched. The general duty of the tribunal to act fairly and impartially remains, as do the grounds for challenging an award for serious irregularity under section 68 and the limited right of appeal on a point of law under section 69, which parties can still exclude by agreement. The Law Commission also decided not to codify a general duty of confidentiality, leaving that to the common law and to institutional rules.
That restraint matters to users. Parties do not need to rethink their whole approach to London arbitration; they need to understand a handful of targeted changes and adjust their clauses and tactics accordingly.
The Act extends to England and Wales and Northern Ireland. Scotland has its own regime under the Arbitration (Scotland) Act 2010 and is not affected.
When the Arbitration Act 2025 applies
The transitional rule is simple but easy to misread. Under section 17 of the Arbitration Act 2025, the amendments do not apply to arbitral proceedings commenced before the relevant provision came into force, or to court proceedings connected with those arbitrations. Otherwise they apply to an arbitration agreement "whenever made".
In practice, that means an arbitration started on or after 1 August 2025 is governed by the amended 1996 Act even if the contract was signed years earlier. Parties to long-term contracts with legacy clauses should therefore assume the new rules will apply to any future dispute, and review whether those clauses still achieve what they were intended to achieve.
The new default rule on the law of the arbitration agreement
The most significant change for drafting is new section 6A of the Arbitration Act 1996. The law applicable to an arbitration agreement is now the law the parties expressly agree applies to the arbitration agreement itself, or, failing that, the law of the seat.
Crucially, a choice of law for the main contract does not count as an express choice for the arbitration agreement. That reverses the approach of the Supreme Court in Enka Insaat ve Sanayi AS v OOO Insurance Company Chubb [2020] UKSC 38, under which the law chosen for the main contract would generally also govern the arbitration clause.
The rule does not apply to arbitration agreements derived from a standing offer in a treaty or in foreign legislation, which preserves the existing approach for investor-state arbitration.
If your contract is governed by a foreign law but seated in London, the Arbitration Act 2025 means English law will now govern the arbitration clause unless you say otherwise. For most parties that is helpful, because English law takes a pro-validity approach. If you want a different result, state the law of the arbitration agreement expressly in the clause itself.
Arbitrators: disclosure, immunity and summary awards
A statutory duty of disclosure
New section 23A requires a prospective arbitrator, and an appointed arbitrator throughout the proceedings, to disclose as soon as reasonably practicable any circumstances that might reasonably give rise to justifiable doubts about their impartiality. An arbitrator is treated as aware of circumstances of which they ought reasonably to be aware. The duty is mandatory, so the parties cannot contract out of it. It codifies and extends the principles in Halliburton Co v Chubb Bermuda Insurance Ltd [2020] UKSC 48.
Stronger arbitrator immunity
The court can no longer order an arbitrator to pay the costs of an application for their removal unless the arbitrator acted in bad faith. An arbitrator's resignation does not give rise to liability unless it is shown to have been unreasonable in all the circumstances. Both changes are designed to protect arbitrators from tactical pressure.
Summary disposal
Under new section 39A, unless the parties agree otherwise, a tribunal may, on a party's application, make an award on a summary basis on a claim or an issue where a party has no real prospect of succeeding on it or in defending it. The tribunal must give the parties a reasonable opportunity to make representations first. The test mirrors the familiar language of court summary judgment, which gives tribunals and parties a recognised standard to work with.
Emergency arbitrators, court support and jurisdiction challenges
New section 41A allows an emergency arbitrator, appointed under institutional rules the parties have adopted, to make a peremptory order if a party fails without sufficient cause to comply with their directions. Those orders can then be enforced with the court's support. The court's powers under section 44 can also now be exercised against third parties, such as banks holding assets or witnesses.
The Act also clarifies that a tribunal can award costs even where it rules, or a court holds, that it has no substantive jurisdiction, and that the time limit for challenging an award runs from a later date where there has been an arbitral appeal or a material correction to the award.
The revised section 67 procedure
Before the reforms, a party challenging a tribunal's jurisdiction under section 67 was entitled to a full rehearing, following Dallah Real Estate and Tourism Holding Co v Ministry of Religious Affairs of Pakistan [2010] UKSC 46.
The Arbitration Act 2025 enables rules of court to restrict that. Where a party took part in the arbitration and the tribunal has already ruled on jurisdiction, new grounds and new evidence will generally not be allowed unless they could not reasonably have been raised before the tribunal, and evidence heard by the tribunal will not be re-heard, subject always to the interests of justice.
The detailed procedure depends on the court rules made to implement these changes, so check the current Civil Procedure Rules before launching or defending a challenge.
| Issue | Before 1 August 2025 | Under the Arbitration Act 2025 |
|---|---|---|
| Law of the arbitration agreement | Usually the law of the main contract (Enka) | Law expressly chosen for the arbitration agreement, otherwise the law of the seat (section 6A) |
| Arbitrator disclosure | Common law duty (Halliburton) | Statutory, mandatory continuing duty, including what the arbitrator ought reasonably to know (section 23A) |
| Summary disposal | Possible under general procedural powers, but uncertain | Express power where there is no real prospect of success, unless the parties opt out (section 39A) |
| Emergency arbitrators | Not addressed by the statute | Peremptory orders and court enforcement support (section 41A) |
| Section 44 orders | Doubt over orders against non-parties | Available against third parties |
| Section 67 challenges | Full rehearing | Rules of court may limit new grounds, new evidence and re-hearing |
How to respond: practical steps for parties
For most businesses, the Arbitration Act 2025 calls for a focused review rather than a wholesale renegotiation of contracts. The priority is the small number of agreements most likely to generate a significant dispute, together with the model clauses used for new deals. The steps below reflect the order in which we usually approach that exercise.
- Audit existing clauses. Identify contracts with a foreign governing law and a London seat, and contracts with an English governing law but a foreign seat. These are the ones most affected by section 6A.
- Decide on the law of the arbitration agreement. For new contracts, state it expressly. English law is a natural choice for a London seat.
- Consider summary disposal. If you want to exclude or limit it, for example in long-term relationship contracts, say so. Most commercial parties will prefer to keep it.
- Choose institutional rules deliberately. Emergency arbitrator provisions sit in institutional rules such as those of the LCIA, so the choice of rules now has a clearer statutory consequence.
- Raise jurisdiction objections early and fully. If you participate in the arbitration, put all grounds and evidence before the tribunal, because a later section 67 challenge may be confined to that record.
- Run conflict checks broadly. When nominating an arbitrator, ask about relationships that the candidate ought reasonably to know of, not just what they actually know.
An illustrative scenario
The following scenario is illustrative only and does not describe any real client or matter.
A Bangladeshi manufacturer and a European buyer sign a supply agreement governed by the law of a civil law jurisdiction, with disputes referred to LCIA arbitration seated in London. The clause says nothing about the law of the arbitration agreement. A dispute arises in 2026, and the buyer argues the arbitration clause is invalid under the governing law of the contract.
Before the Arbitration Act 2025, the court would likely have applied the contract's governing law to that question. Now, because the arbitration started after 1 August 2025 and the parties made no express choice for the arbitration agreement, English law as the law of the seat applies. The manufacturer can also seek an early award on a summary basis on any issue where the buyer's defence has no real prospect of success, which may shorten the proceedings and reduce cost.
The buyer, meanwhile, cannot keep a new jurisdiction argument in reserve for court. If it participates and loses on jurisdiction before the tribunal, any later challenge in the Commercial Court is likely to be confined to the arguments and evidence it put to the tribunal.
When it comes to enforcement in Bangladesh, the manufacturer's advisers will plan for recognition under the New York Convention and local procedure; see our guide to enforcing a London arbitration award in Bangladesh.
Risks and common mistakes
Assuming old contracts are untouched by the reforms
The test under the Arbitration Act 2025 is when the arbitration started, not when the contract was signed. An agreement from 2015 is governed by the new rules if the arbitration commenced on or after 1 August 2025. Parties who drafted with Enka in mind, expecting their contract's governing law to apply to the clause, may now find the law of the seat applies instead. Review high-value legacy contracts, particularly those with foreign governing law and a London seat.
Holding back jurisdiction arguments for court
Some parties used to participate in an arbitration while keeping their best jurisdiction points for a section 67 rehearing. That strategy carries real risk under the new framework. Where a party took part and the tribunal ruled, rules of court may prevent new grounds and new evidence unless they genuinely could not have been raised earlier. Put the full case on jurisdiction to the tribunal at the outset.
Treating summary disposal as automatic
The section 39A power is discretionary, requires an application and a fair opportunity to respond, and can be excluded by agreement. Tribunals will also need to manage the risk of a later challenge for serious irregularity if a party says it was denied a fair hearing. Applications should be targeted at genuinely hopeless claims or defences, and supported by a clear procedural proposal for how the tribunal should decide them.
Overlooking disclosure in arbitrator selection
The statutory duty is on the arbitrator, but the consequences of a missed conflict fall on the parties, including the risk of a removal application or a challenge to the award. When proposing a candidate, ask specific questions about repeat appointments, related-party relationships and connections with funders. Our international arbitration team builds these checks into every appointment.
The cross-border angle
London's appeal as a seat rests on neutrality, supportive courts and the enforceability of awards under the New York Convention. The Arbitration Act 2025 reinforces that by reducing the risk of satellite litigation over governing law and jurisdiction. For parties from Bangladesh, the Gulf, Singapore and China, a London seat with English law governing the arbitration agreement now provides a more predictable package than before.
Enforcement still depends on the law where assets are located, and local courts may take their own view on public policy or arbitrability. Our Bangladesh arbitration in London team advises on clauses and awards that need to work in both jurisdictions, and our guide to English law in Bangladesh contracts explains the drafting choices.
Checklist: arbitration clauses after the 2025 reforms
- State the seat clearly, and name the law of the arbitration agreement expressly.
- Choose institutional rules that suit the dispute profile, including emergency relief.
- Decide whether to keep, limit or exclude summary disposal.
- Consider the number of arbitrators, language and confidentiality provisions.
- Check how the clause interacts with any litigation or mediation steps, and keep escalation clauses short and certain.
- Review legacy contracts likely to produce disputes in the next few years.
We advise on clause drafting, institutional and ad hoc arbitration, and related court applications, working with our commercial litigation team. Where advocacy in the higher courts is required, we instruct specialist counsel. To review a clause or discuss a dispute, please contact our London office.
Frequently asked questions
01When did the Arbitration Act 2025 come into force?
The Act received Royal Assent on 24 February 2025. Its substantive amendments to the Arbitration Act 1996 came into force on 1 August 2025. They apply to arbitral proceedings commenced on or after that date, and to related court proceedings, regardless of when the arbitration agreement was made. Arbitrations commenced before 1 August 2025, and court proceedings connected with them, continue under the unamended 1996 Act.
02Does the Arbitration Act 2025 apply in Scotland?
No. The Act extends to England and Wales and Northern Ireland, mirroring the Arbitration Act 1996 it amends. Arbitrations seated in Scotland are governed by the Arbitration (Scotland) Act 2010, which has its own rules. Parties choosing a UK seat should therefore specify the city, such as London, rather than simply referring to the United Kingdom, to avoid uncertainty about which statute applies.
03Which law governs an arbitration agreement under the new rules?
Under new section 6A of the Arbitration Act 1996, the arbitration agreement is governed by the law the parties expressly agree applies to it, or, if there is no such agreement, the law of the seat. A choice of law for the main contract does not count as an express choice for the arbitration agreement. This reverses the Supreme Court's approach in Enka v Chubb. The rule does not apply to arbitration agreements based on standing offers in treaties or foreign legislation.
04Can a tribunal now dismiss a weak claim early?
Yes. New section 39A gives the tribunal power, unless the parties agree otherwise, to make an award on a summary basis on a claim or a particular issue if a party has no real prospect of succeeding on the claim or issue, or in defending it. A party must apply on notice, and the tribunal must give the parties a reasonable opportunity to make representations. The procedure for deciding the application is otherwise for the tribunal.
05What do arbitrators now have to disclose?
Under new section 23A, a person approached about a possible appointment, and an appointed arbitrator throughout the proceedings, must disclose as soon as reasonably practicable any circumstances that might reasonably give rise to justifiable doubts about their impartiality. They are treated as aware of circumstances they ought reasonably to be aware of, which effectively requires reasonable enquiries. The duty is mandatory and cannot be excluded by the parties.
06Has the right to challenge jurisdiction under section 67 been removed?
No. A party can still challenge an award in court on the ground that the tribunal lacked substantive jurisdiction. What has changed is the procedure. Where the challenger took part in the arbitration and the tribunal has ruled on jurisdiction, rules of court may prevent new objections and new evidence unless they could not reasonably have been raised before, and prevent the court re-hearing evidence, subject to the interests of justice.
Sources and official materials
- Arbitration Act 2025 — Amending Act, including commencement and transitional rules
- Arbitration Act 1996 — The principal Act as amended
- Law Commission: Review of the Arbitration Act 1996 — Reports and draft Bill behind the reforms
- Halliburton Co v Chubb Bermuda Insurance Ltd [2020] UKSC 48 — Arbitrator disclosure and impartiality
- Commercial Court — Court supervising most London-seated arbitrations
- London Court of International Arbitration — Institutional rules, including emergency arbitrators
General information only, current as at 21 October 2026. It is not legal advice and does not create a solicitor–client relationship. It reflects the law of England and Wales unless stated otherwise; Scotland and Northern Ireland have separate legal systems, and the law changes frequently. Check current official sources and take advice on the facts of your matter.